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Questions dog state’s Medicaid managed-care switch

By John O’Connor 
AP Political Writer

SPRINGFIELD — Hundreds of thousands of Illinois residents covered by Medicaid will see their health coverage change Sunday when they’re transferred into managed care.

HealthChoice Illinois, a plan ordered by the Legislature in 2014 to reduce costs, enlists Managed Care Organizations to handle health care. MCOs purportedly focus on prevention and health maintenance with an eye toward lowering costs.

Critics have had plenty to say about the rollout of the four-year, $60 billion Illinois plan, from the way Republican Gov. Bruce Rauner’s administration contracted with the MCOs chosen, to concerns about the MCOs’ reimbursement rates and the state’s track record of monitoring them.

“HealthChoice Illinois provides the same services as traditional Medicaid, with enhanced features such as care coordination, which offers individuals direct help to find the right care at the right time and place for them,” said John Hoffman, spokesman for the Department of Healthcare and Family Services.

He said the department is “measuring how successfully plans are treating member conditions and will work with them to improve outcomes.”

Managed care had already been the norm in Cook County and the new MCOs started work there Jan. 1. The expansion adds 550,000 clients in 72 counties. Those affected were notified earlier this year and had 30 days to choose a plan. Hoffman said they have 90 days after April 1 to switch if they change their minds.

The state maintains it will save as much as $300 million over the four-year deal because of the competitive rates, less overhead and more efficient administration.

But Rep. Greg Harris, a Chicago Democrat who tried unsuccessfully to require a traditional, wide-open bidding process, also has been concerned since an MCO under a similar plan in Iowa pulled out because it lost too much money.

“Are the networks set up and are providers ready to start accepting patients, or are we going to see major problems?” Harris asked. “I hope providers — the doctors, hospitals, pharmacies, durable goods providers — are in place.”

One MCO, Molina Healthcare, issued a statement saying that for more than three decades the company “has been able to achieve cost savings while improving health outcomes through care coordination, commitment to quality and a focus on preventive care, which is at the core of the HealthChoice Illinois program.”

But when another MCO, IlliniCare Health, announced last fall it would cut vendor payments for medical equipment by as much as 50 percent, more concern arose.

“We get into a situation where the rates are so low, with cuts of 10 to 50 percent, (medical equipment) companies can’t even stay afloat,” said Susan Agrawal of Chicago, who represents a group of parents of children known as “medically fragile, technologically dependent.” Those children are set to join the program July 1, although legislation sponsored by Rep. Fred Crespo, a Hoffman Estates Democrat, would exempt them.

An association of equipment providers wants further legislative intervention. Kevin Stewart, president of the Great Lakes Home Medical Services Association, calls the Rauner transition “rushed” and wants legislative strictures on the MCOs.

“Unless the General Assembly steps in to set parameters for managed care organizations, we fear this is nothing more than MCOs enriching themselves at the expense of the state’s most vulnerable,” Stewart said.

A message seeking comment from IlliniCare Health was not returned.

Sen. Dave Koehler, a Peoria Democrat, has legislation regulating the fees for durable medical equipment along the lines of current, fee-for-service rates.

Others have questioned the administration’s ability to monitor the landscape.

Crespo released a letter last week, co-signed by Barrington Hills Republican Rep. David McSweeney and Democratic Rep. Emanuel “Chris” Welch of Hillside, to Attorney General Lisa Madigan, asking her to investigate the failure of HFS to monitor $7.1 billion in payments to MCOs during 2016.

The findings were published in January in a state audit that lawmakers had ordered to compare the state’s costs for the existing MCO program with costs of traditional, fee-for-service plans. HFS spokesman Hoffman said at the time the “rebooted managed care program” underway this year would “ensure program integrity and accountability, protecting taxpayer dollars while providing quality care.”

Eileen Boyce, spokeswoman for Democrat Madigan, said of Crespo’s letter, “We are aware of the issue and have been closely monitoring it.”

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